Consider some examples of things that are obvious to economists but bewildering to most people. Economists believe that a country can increase the incomes of its workers by importing products that they can produce with less effort and fewer resources than workers anywhere else in the world, a belief that is dismissed as bizarre by most normal people. When economists argue that there is an optimal amount of traffic fatalities, or environmental damage from pollution, or sexual harassment, or child abuse, most people are too appalled to appreciate the logic behind those arguments. Despite the powerful case economists make that the cost of goods increases when government subsidizes the goods’ purchase, politicians continue to win elections by providing consumer subsidies. And it is easy to predict the reaction to economists when they propose reducing the threat to endangered species by making it legal for people to own some of them and profit by letting trophy hunters shoot them. There are many other examples of economists seeing as sensible things that most people see as weird (or worse).
Leeson is not primarily concerned, however, with defending the “weird” views of economists. His book instead explains why several historical practices that many readers will consider outrageous were actually quite sensible given the understandings and incentives that prevailed at the time. His explanations are based on the highly commendable way economists consider the practices of others.
When we see or hear of others doing things that make no sense to us, it is easy to dismiss them as irrational if not downright stupid. Economists try to avoid this “stupidity” assumption because it often obscures reasonable, albeit sometimes difficult to understand, explanations. The powerful understandings economists have gained over the years were made possible by assuming that people pursue their interests—both narrow and noble—in rational ways given the constraints and incentives they face.
In order to develop these understandings, Leeson makes a serious effort to find out the legal details, social norms, and institutional incentives that constrained the choices people faced in bygone times. He then applies economic theory creatively to understand why people facing those constraints benefited from the seemingly weird and outrageous practices.
His narrative finds him conducting a sort of museum tour with seven exhibits. He begins with some introductory comments on the importance of curiosity and being open to the possibility that if a practice survives for a few generations, it may have been socially sensible no matter how weird it seems today. I cover only four of his exhibits in this review, with overview discussions of his detailed but very accessible analysis.
Hot water / The first exhibit, titled “Burn, Baby, Burn” (Chapter 2), examines the practice of “trial by ordeal” that was common in Europe in the 9th–13th centuries CE. The ordeals could involve heat or cold. In one example, the defendant would “ ‘plunge his hand into … boiling water’ and pluck it out.’ ” If the defendant was innocent, his hand would be “safe and unharmed,” people believed, but if guilty his hand would “show burn injuries on inspection three days later.” Trial by ordeal could also find the accused carrying a “burning hot iron nine paces.” The accused would be judged innocent if his hands were not damaged and guilty if they were.
Trial by ordeal was held in reserve for those being tried for the most serious crimes, and then only when the evidence was considered too ambiguous for earthly judgement. The rationale for trials by ordeal was to “let doubtful cases be settled by the judgement of God.” The accused wasn’t required to accept a trial by ordeal, but refusing the offer would suggest guilt. The astonishing thing is, as Leeson explains, “it seems that ordeals actually exonerated the majority of people who underwent them” (his emphasis).
He finishes with a compelling argument that, given the prevailing beliefs and primitive technology of the day, trials by ordeal were sensible ways to reach decisions on guilt or innocence in tough cases. Furthermore, he argues that practices similar to “medieval-style ordeals” are used today to help determine criminal innocence or guilt, such as lie detector tests (which depend on the stress that test takers feel about lying when being monitored) and swearing an oath on the Bible.
Honoring and obeying until sold / Even trained economists may initially be appalled by Leeson defending the practice of letting men sell their wives to the highest bidder at public auctions. Yet, this is what men could do in 18th–19th century England. He explains in Chapter 3 that the practice benefited both men and women, but particularly women.
Private sales were allowed, but they typically took place in public auctions because husbands expected open competition to yield the highest price. Not surprisingly, husbands generally claimed the “merchandise” possessed fine attributes, but some were “shockingly honest” in acknowledging flaws. For example, one husband’s pre-auction description said his wife was a “tormentor, a domestic curse, a night invasion, and a daily devil.”
Most sales were final, though one husband “allowed his wife’s purchaser to try her out for three days, after which, if the buyer was unhappy, he could bring her back for 50 percent of her purchase price.” Also, some purchasers bought wives with the intention of improving and flipping them.
The bid for a wife was not always in cash. “Alcohol was a popular supplement to cash compensation.” Other cases included “lottery tickets, dinners, and a donkey” being used for payment.
It is easy to be outraged today at the thought of a woman having to endure the humiliation of her husband trading her for a donkey. But Leeson’s argument recognizes that few of us today have enough knowledge of the 18th century English legal system to judge how an Englishwoman might have felt about being publicly auctioned off. Even with knowledge of that legal system we might still, under the influence of today’s norms, express outrage at the restrictions it imposed on the choices of Englishwomen almost 300 years ago. But our norms are irrelevant to understanding what was sensible in England, or anywhere else, long ago.
That fact counsels our being open to Leeson’s argument that the woman we assumed was humiliated was more likely overjoyed because of recent improvements in the English common law. Auctioning off a wife was one those improvements because, by allowing her husband to get an ass in exchange, it made it possible for her to get rid of one.
Admittedly, the improvements in English common law that increased the options available to women were painfully slow. But Leeson’s argument moves us closer to understanding why the legal status of women improved faster in England, and countries influenced by the English common law, than anywhere else in the world.
Can lawyers put exterminators out of business? / In large parts of Europe in the 15th–17th centuries, insects, rodents, and other vermin could be taken to ecclesiastic courts for being too aggressive. As Leeson explains in Chapter 7, these trials were apparently conducted with the utmost seriousness, with “distinguished judges ordering crickets to follow legal instructions, dignified jurists negotiating a settlement between farmers and beetles, and a decorous court granting a hoard of rat defendants a continuance on the grounds that some cats prevented them from attending their trials.”
Defendants were summoned to appear in court by reading the summonses where the defendants were generally found. If they failed to appear after three summonses, the court could convict them. Occasionally, however, some representatives of the charged species were brought to court for trial, and then released into their natural habitat to communicate the verdict to their fellow criminals after it was reached. Convicted pests were also notified that the penalty for refusing to turn themselves in was excommunication from the Holy Church.
How to explain bringing legal action against pests for behaving naturally? Part of Leeson’s attempt is found in Chapter 5, where he explains the social benefits from medieval clerics’ curses on those with whom they disagreed. He points out that a guilty verdict on destructive pests was an ecclesiastic curse widely considered to be as effective as those imposed on sinful humans. Furthermore, he argues that these judicial curses were perceived to reduce the damage from pests. This allowed the clergy to hold onto their legitimacy where it was being threatened by critics of the Church. The legitimacy allowed the clergy to continue generating general benefits with comforting promises to their flocks of a pleasant afterlife and less aggravation from pests during this life. With even more confidence, it allowed the clergy to continue capturing financial benefits with “thinly veiled threat[s] of continued plague if citizens continue to evade their tithes.”
More entertaining than a title search / In 12th–13th century England, good records on land ownership didn’t exist. For this and other reasons related to the feudal social structure, allocating land though markets was plagued with high transactions costs, resulting in regular disputes over land ownership. Courts attempting to resolve these disputes often turned to heavenly help by arranging combat between representatives of the two disputants—the assumption being that God would favor the rightful owner.
As Leeson explains in Chapter 8, these representatives, referred to as champions, were chosen for their physical prowess. Indeed, some disputants tried to corner the market on brutes to limit their availability to opposing disputants. They believed in God, but they had also heard that God helps those who help themselves, even in underhanded ways.
These practices are second-best solutions. When people in the past were subject to a weird belief or practice, it’s possible they were made better off.
From an economic perspective, however, the problem was not just allocating land to rightful owners, but to owners who would make the most valuable use of it. Leeson discusses an interesting parallel between combat competition for God’s favor in land disputes and rent-seeking today for politicians’ favor in the competition for government largess, even though he considers the former to be more productive than the latter. He points out that “trial by battle enabled judges faced with [poor property rights] to do what the Coase theorem could not: get the land into the hands of the person who valued it more.” He also points out that after King Henry II introduced reforms that “marked the birth of English common law and the beginning of feudalism’s end in England,” there was a marked decline in the cost of trading land in markets—and a disappearance of trial by battle.
Of course, progress always comes at a cost. Leeson does say that the battles between champions were usually not very dangerous for the combatants. They also attracted large crowds when land disputes were on the court’s docket. Commonly, before the battle started, the disputants decided to settle. When that happened, the battle often took place anyway to avoid disappointing the crowd.
Second best / A generic explanation for people’s initial negative reaction to these old practices is grounded in the economic “theory of the second best.” The theory holds that efforts to eliminate a market inefficiency can sometimes make the market less efficient. Therefore, it is theoretically possible that adding a specific market inefficiency—a second-best solution—will improve market efficiency generally.
A plausible case can be made that claimed “second-bests” often are not more efficient on net. It depends on the existence of particular conditions, and creating a steady stream of market inefficiencies is an unlikely way to improve economic performance.
In essence, the practices Leeson highlights and explains are second-best solutions. He recognizes that his variation of the theory applies only under suitable conditions that have varied over time and place. But when those conditions are right, what I see as Leeson’s “theory of the weird second best” supports his conclusions. This theory can be stated as follows: When people in the past were subject to a belief or practice that we consider weird today, it is possible that they were made better off by the addition of another belief or practice that we consider even weirder. As Leeson states: “Seeming senselessness on top of seeming senselessness = pretty damn sensible.”
No reason to be smug / In this Twitter/flame-war age, feeling superior to others has become a global pastime. Feeling superior to those who lived long ago has the additional advantage that our predecessors cannot now defend themselves. But Leeson gives them a champion. They would applaud with enthusiasm when he questions whether some of our modern-day practices are any more sensible than some of the historical practices we now dismiss as weird (or worse).
We can only guess what future generations will think about some of our practices, which are often supported by large numbers of highly educated, overtly compassionate, and consistently smug voters. For example, governments try to reduce poverty with government programs that penalize those who reduce their own poverty through productive activity. Politicians proclaim the importance of education and employment to poverty reduction, but protect school systems and pedagogies that render disadvantaged populations poorly educated. Worse, the same politicians often defend—and tighten—minimum-wage laws and occupational licensing laws that leave these same people unemployed and vocationally untrained. Government tries to reduce monopoly power by restricting mergers while reducing competition by restricting imports, creating regulations making it more difficult for small firms to grow or survive, and favoring the largest firms with bailouts and tax breaks.
Any good public choice economist could list more examples of political practices that future generations will consider every bit as weird as the practices Leeson discusses. Maybe several hundred years from now a future Leeson will try to explain how our political weirdness made even a modicum of sense in the 20th and 21st centuries.
